Economic and Political Overview

flag Uruguay Uruguay: Economic and Political Overview

In this page: Economic Indicators | Foreign Trade in Figures | Sources of General Economic Information | Political Outline

 

Economic Indicators

Uruguay has the highest income per capita and the largest middle-class share in Latin America, but it faces challenges in boosting growth. The economy grew by 5.3% annually from 2003 to 2014, but only 1% from 2014 to 2019, and 0.7% between 2019 and 2023. According to the Central Bank, Uruguay's economy grew by 3.1% in 2024, driven by improved agricultural yields after the previous year’s drought, higher hydropower generation, increased trade, and greater cellulose production. However, positive results were partially offset by the negative performance of the construction sector, as the Central Railway project, linking UPM's second plant to the Port of Montevideo, was completed. Growth is expected to stabilize at around 2.6% in 2025-2026, converging towards its potential. Private consumption is forecast to remain strong as inflation pressures ease, while fixed investment is projected to increase as global financial conditions gradually improve (World Bank).

The deficit and debt outcomes in 2023 were in line with the fiscal rule targets. Adherence to the rule for four consecutive years helped stabilise the debt-to-GDP ratio despite a series of negative shocks. The pension system reform, approved in May 2023, is expected to stabilize spending in the medium term. According to the latest figures released by the Ministry of Economy and Finance, the fiscal deficit of the consolidated public sector was 4.1% of GDP at the end of last year. By 2026, the fiscal deficit is expected to further decrease to 2.7% of GDP as consolidation efforts continue. Net indebtedness is projected to stay within the legal limit, with public sector debt forecasted at 64-65% of GDP during the period (World Bank). In 2024, inflation ended at 5.49%, within the Central Bank's target range. The Consumer Price Index was slightly above the 2023 figure, which closed at 5.11% (data Central Bank). Average inflation is expected to remain relatively stable over 2025-2026.

Figures from INE show that, in December 2024, the national activity rate was 64.6%, the employment rate was 59.8%, and the unemployment rate was 7.4%. Uruguay has one of the highest levels of GDP per capita in South America and a developing middle class (USD 34,440 in 2024, as per the IMF). The country has had strong political and social stability for years, backed by a consolidated democracy and strong legal security, which makes it attractive to investors. Furthermore, the population living below the poverty line has decreased significantly in the past decade: at present, the percentage of households residing in poverty stands at 6.4%, as measured by the international poverty line of USD 6.85 per capita per day (World Bank).

 
Main Indicators 2023 (E)2024 (E)2025 (E)2026 (E)2027 (E)
GDP (billions USD) 77.2482.4886.4290.4394.79
GDP (Constant Prices, Annual % Change) 0.43.23.02.62.4
GDP per Capita (USD) 21,65723,05324,08025,12126,253
General Government Balance (in % of GDP) -2.2-3.2-2.6-2.4-2.2
General Government Gross Debt (in % of GDP) 64.564.765.065.265.0
Inflation Rate (%) 5.94.95.45.14.8
Unemployment Rate (% of the Labour Force) 8.38.48.08.08.0
Current Account (billions USD) -2.91-2.27-2.22-2.13-2.03
Current Account (in % of GDP) -3.8-2.7-2.6-2.4-2.1

Source: IMF – World Economic Outlook Database , Latest available data

Note: (e) Estimated Data

Main Sectors of Industry

Uruguay’s natural resources are very limited, mainly due to the country's size. There is a significant mining industry in the country, which mainly revolves around basalt, dolomite, limestone, quartz, granite, and marble. There is only one gold-producing mine in Uruguay, and the country is a major producer of cement and semi-precious stones, particularly agate and amethyst. Even though only around 11.6% of the land is arable, agriculture is the largest export sector in Uruguay. It accounts for 5.6% of the GDP and employs 8.7% of the active population. Uruguay has rich agricultural land and almost 90% of it is devoted to livestock breeding (cattle, sheep, horses, and pigs). Rice is the main crop, followed by wheat, maize, sugar cane, soybeans, and tobacco. Vegetable and fruit farming are also present throughout the country, as well as a prominent wine industry along the coast of the Rio de la Plata. In 2023-24, Uruguay's main export product was once again beef: the total revenue from the meat sector amounted to USD 2.637 billion (-2.6% compared to 2022/2023), of which 80% was beef, 11% consisted of by-products (primary, residual, and processed), and offals accounted for 4.2% of total exports. For beef, the equivalent volume in carcass weight was 527,902 tons, marking an 11.3% increase compared to the previous year. It is important to note that this value is the second highest of the decade and exceeds the 10-year average by 60,000 tons (467,662 tons – data INAC).

The industrial sector contributes to 16.4% of the country's GDP and employs 19% of the active population. Agriculture and animal food processing account for half of the industrial activity. Other manufacturing activities include beverages (especially wine), textiles, construction materials, chemicals, oil, and coal. Additionally, Uruguay has invested heavily in the paper industry, which is expanding. The manufacturing sector as a whole is estimated to account for 9% of GDP. According to the latest data from the National Institute of Statistics (INE), in 2024, industrial production grew by 1.8%: the biggest contributor was paper manufacturing (+14.5%, +1.8 pp), driven by cellulose. Food product manufacturing rose 2.2% (+0.9 pp), with growth in fruit and vegetable processing. Pharmaceutical products increased 13.2% (+0.79 pp), and computer/electronic products (+24.6%) and leather products (+18.1%) also showed strong performance. On the downside, petroleum refining dropped 13.6% (-0.5 pp) due to the La Teja refinery shutdown, while motor vehicle manufacturing fell 13.4% (-0.4 pp).

The services sector contributes to 66.3% of the GDP and employs 72.3% of the active population, mainly in finance and tourism. Particularly, the region around Punta del Este attracts a large number of visitors, which has driven the rise in building, leading to a construction boom in the area in recent years. However, the country welcomed 3.34 million tourists in 2024, marking a 13% decrease year-on-year (data Ministry of Tourism). The structure of Uruguay's financial system comprises two public banks, eleven private banks, and a diverse array of non-banking institutions.

 
Breakdown of Economic Activity By Sector Agriculture Industry Services
Employment By Sector (in % of Total Employment) 8.7 19.0 72.3
Value Added (in % of GDP) 5.6 16.4 66.3
Value Added (Annual % Change) 5.1 -3.7 1.1

Source: World Bank - Latest available data.

 

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Monetary Indicators 20162017201820192020
Uruguayan Peso (UYU) - Average Annual Exchange Rate For 1 MUR 0.850.830.910.991.07

Source: World Bank - Latest available data.

 
 

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Indicator of Economic Freedom

Definition:

The Economic freedom index measure ten components of economic freedom, grouped into four broad categories or pillars of economic freedom: Rule of Law (property rights, freedom from corruption); Limited Government (fiscal freedom, government spending); Regulatory Efficiency (business freedom, labour freedom, monetary freedom); and Open Markets (trade freedom, investment freedom, financial freedom). Each of the freedoms within these four broad categories is individually scored on a scale of 0 to 100. A country’s overall economic freedom score is a simple average of its scores on the 10 individual freedoms.

Score:
69,3/100
World Rank:
44
Regional Rank:
4

Economic freedom in the world (interactive map)
Source: Index of Economic Freedom, Heritage Foundation

 
 

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Foreign Trade in Figures

Uruguay has an open economy, with foreign trade representing 52% of its GDP, according to the World Bank's latest available data. Uruguay enjoys special preferential access to trade with several countries under ALADI’s Economic Complementation Agreements. In 2023, the ranking of exported products was led by beef, constituting 18% of the total exports. Cellulose held the second position with a comparable share, followed by dairy products, beverage concentrates, rice, meat by-products, wood, soybeans, and vehicles. The largest import category in 2023 was industrial supplies, accounting for 28% of the total, followed by vehicles and their parts (17%), and food and beverage (14% - data Uruguay XXI).

The main destination for Uruguay's exports in 2023 was China, accounting for 22% of the total, closely followed by Brazil with 19%. The European Union ranked third with 16%, while the United States and Argentina represented 8% and 5%, respectively. On the other hand, Brazil was the top source of Uruguay's imports, accounting for 24% of the total, with a value of USD 2.557 billion. China followed as the second-largest source, representing 22% of imports. The European Union ranked third, with imports worth USD 1.580 billion, a 4% increase. Argentina was the fourth-largest source, contributing 6% of total imports (data Uruguay XXI).

As Uruguay mainly exports agricultural products, they are highly vulnerable to international price fluctuations. In 2023, exports of goods stood at USD 9.19 billion against USD 12.48 billion in imports (-17.8% and -3.7%, respectively); whereas services exports (at USD 6.39 billion) were higher than imports (USD 6.02 billion – data WTO). According to preliminary government figures, Uruguay's goods exports reached USD 12.84 billion in 2024. The top exports included cellulose, beef, soybeans, dairy products, and beverage concentrate. Excluding petroleum, derivatives, and energy, goods imports totalled USD 10.87 billion in 2024.

 
Foreign Trade Indicators 20192020202120222023
Imports of Goods (million USD) 8,2467,56410,32012,97312,486
Exports of Goods (million USD) 7,6806,8649,53511,1849,193
Imports of Services (million USD) 4,7513,5283,9235,4516,021
Exports of Services (million USD) 5,3573,7293,7465,4736,397
Imports of Goods and Services (Annual % Change) 1.9-12.617.912.46.0
Exports of Goods and Services (Annual % Change) 5.2-15.913.59.80.7
Imports of Goods and Services (in % of GDP) 21.821.124.826.924.2
Exports of Goods and Services (in % of GDP) 27.925.632.032.027.5
Trade Balance (million USD) 3,1132,2574,7304,0802,134
Trade Balance (Including Service) (million USD) 3,7812,4304,5264,2052,746
Foreign Trade (in % of GDP) 49.746.756.858.851.7

Source: WTO – World Trade Organisation ; World Bank , Latest Available Data

 

Main Partner Countries

Main Customers
(% of Exports)
2023
Brazil 20.5%
China 16.8%
United States 8.1%
Argentina 5.0%
Türkiye 2.8%
See More Countries 46.7%
Main Suppliers
(% of Imports)
2023
Brazil 21.9%
China 19.1%
Argentina 12.0%
United States 8.8%
Nigeria 4.3%
See More Countries 33.9%

Source: Comtrade, Latest Available Data

 
 

Main Products

9.2 bn USD of products exported in 2023
Meat of bovine animals, frozenMeat of bovine animals, frozen 17.5%
Wood in the rough, whether or not stripped of bark...Wood in the rough, whether or not stripped of bark or sapwood, or roughly squared (excl. rough-cut wood for walking sticks, umbrellas, tool shafts and the like; wood in the form of railway sleepers; wood cut into boards or beams, etc.) 9.0%
Milk and cream, concentrated or containing added...Milk and cream, concentrated or containing added sugar or other sweetening matter 6.6%
RiceRice 6.6%
Soya beans, whether or not brokenSoya beans, whether or not broken 4.5%
See More Products 55.9%
12.5 bn USD of products imported in 2023
Petroleum oils and oils obtained from bituminous...Petroleum oils and oils obtained from bituminous minerals, crude 6.9%
Petroleum oils and oils obtained from bituminous...Petroleum oils and oils obtained from bituminous minerals (excl. crude); preparations containing >= 70% by weight of petroleum oils or of oils obtained from bituminous minerals, these oils being the basic constituents of the preparations, n.e.s.; waste oils containing mainly petroleum or bituminous minerals 6.2%
Motor cars and other motor vehicles principally...Motor cars and other motor vehicles principally designed for the transport of persons, incl. station wagons and racing cars (excl. motor vehicles of heading 8702) 4.3%
Motor vehicles for the transport of goods, incl....Motor vehicles for the transport of goods, incl. chassis with engine and cab 3.3%
Telephone sets, incl. telephones for cellular...Telephone sets, incl. telephones for cellular networks or for other wireless networks; other apparatus for the transmission or reception of voice, images or other data, incl. apparatus for communication in a wired or wireless network [such as a local or wide area network]; parts thereof (excl. than transmission or reception apparatus of heading 8443, 8525, 8527 or 8528) 2.8%
See More Products 76.4%

Source: Comtrade, Latest Available Data

 
 

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Main Services

8.1 bn USD of services exported in 2022
49.71%
21.53%
12.04%
7.90%
3.48%
2.63%
1.01%
0.78%
0.64%
0.28%
5.0 bn USD of services imported in 2022
31.65%
27.48%
19.82%
7.28%
3.67%
2.65%
2.27%
2.20%
2.05%
0.89%
0.03%

Source: United Nations Statistics Division, Latest Available Data

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Sources of General Economic Information

Ministries
Official list of ministries and links
Ministry of Economy and Finances (in Spanish)
Ministry of Foreign Affairs (in Spanish)
Ministry of Industry, Energy and Mining (in Spanish)
Ministry of Transport and Public Works (in Spanish)
Ministry of Social Development (in Spanish)
Statistical Office
National Institute of Statistics (in Spanish)
Central Bank
Central Bank of Uruguay
Stock Exchange
Uruguay Stock Exchange (in Spanish)
Search Engines
Uruguay Total
LoGratis
Google Uruguay
Red Academy of Uruguay
Economic Portals
Brecha

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Political Outline

Current Political Leaders
President: Yamandú ORSI Martínez (since 1 March 2025)
Next Election Dates
Presidential: November 2029
Legislative: October 2029
Main Political Parties
Uruguay has a multi-party system with three dominant political coalitions. Outside of these coalitions, it is extremely difficult for any other political party to achieve electoral success. The dominant political forces are:

- Broad Front (FA): center-left coalition comprising various groups, including the Movimiento de Participación Popular (MPP), the Socialist Party (PS), and Vertiente Artiguista (VA). After a period in opposition, the FA returned to power in March 2025 with Yamandú Orsi as president
- National Party (PN): conservative party, nationalist, liberal, also referred to as the "White Party"
- Colorado Party: centre-right, a liberal and social-democratic party, one of the most elected parties in Uruguayan history
- Open Cabildo (Cabildo Abierto): right-wing, populist, conservative
- Independent Party (PI): centre, a social democratic and Christian socialist party, advocates "Third Way" - an alternative to the traditional left and right-wing politics
- Ecologist Radical Intransigent Party (PERI): centre to centre-left, green politics, liberal
- Popular Unity (UP): coalition of left-wing and far-left, Marxist-communist, anti-imperialist
- Party of the People (Partido de la Gente): right-wing, populist, conservative
- Green Animalist Party (PVA): centre to centre-right, green conservatism, animal rights, direct democracy
- Workers' Party (Partido de los Trabajadores): far-left, Trotskyist, socialist
- Digital Party (Partido Digital): the party advocated for e-democracy and is against being labelled either right, centre, or left.

Type of State
Uruguay is a constitutional republic with a presidential representative democratic system.
Executive Power
The President of the Republic is both the Head of State and the Head of Government and is elected by universal suffrage for a five-year term. While the President may be reelected any number of times, immediate reelection is not allowed by the Constitution.
Legislative Power
Parliament is bicameral. The General Assembly is made up of the Chamber of Senators, which is composed of 30 members directly elected to serve 5-year terms; and the Chamber of Representatives, composed of 99 members directly elected to serve 5-year terms.
 

Indicator of Freedom of the Press

Definition:

The world rankings, published annually, measures violations of press freedom worldwide. It reflects the degree of freedom enjoyed by journalists, the media and digital citizens of each country and the means used by states to respect and uphold this freedom. Finally, a note and a position are assigned to each country. To compile this index, Reporters Without Borders (RWB) prepared a questionnaire incorporating the main criteria (44 in total) to assess the situation of press freedom in a given country. This questionnaire was sent to partner organisations,150 RWB correspondents, journalists, researchers, jurists and human rights activists. It includes every kind of direct attacks against journalists and digital citizens (murders, imprisonment, assault, threats, etc.) or against the media (censorship, confiscation, searches and harassment etc.).

World Rank:
18/180
 

Indicator of Political Freedom

Definition:

The Indicator of Political Freedom provides an annual evaluation of the state of freedom in a country as experienced by individuals. The survey measures freedom according to two broad categories: political rights and civil liberties. The ratings process is based on a checklist of 10 political rights questions (on Electoral Process, Political Pluralism and Participation, Functioning of Government) and 15 civil liberties questions (on Freedom of Expression, Belief, Associational and Organizational Rights, Rule of Law, Personal Autonomy and Individual Rights). Scores are awarded to each of these questions on a scale of 0 to 4, where a score of 0 represents the smallest degree and 4 the greatest degree of rights or liberties present. The total score awarded to the political rights and civil liberties checklist determines the political rights and civil liberties rating. Each rating of 1 through 7, with 1 representing the highest and 7 the lowest level of freedom, corresponds to a range of total scores.

Ranking:
Free
Political Freedom:
1/7

Political freedom in the world (interactive map)
Source: Freedom in the World Report, Freedom House

 

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Latest Update: May 2025